A “domestic beheading” inspired by foreign fanatics is one of several threats New Zealand potentially faces from the so-called Islamic State, John Key said this morning.

Mr Key told The Nation a disproportionate number of Islamic State (IS) fighters were sourced from in and around Oceania. He said it was possible this would increase the likelihood of another “Bali bombing” terrorist act.

The Prime Minister said IS terrorists returning to New Zealand were another possible security risk. He said IS also posed a major risk to Kiwi aid workers and other expatriates based in the Middle East.

He told TV3 these reasons, together with the “frightening” growth of IS were among the reasons New Zealand might join combat operations against the rogue state.